{"@context":"https:\/\/schema.org\/","@type":"BlogPosting","@id":"https:\/\/www.indusind.com\/iblogs\/personal-loan\/why-does-cibil-score-matter-for-personal-loan\/#BlogPosting","mainEntityOfPage":"https:\/\/www.indusind.com\/iblogs\/personal-loan\/why-does-cibil-score-matter-for-personal-loan\/","headline":"Why Does CIBIL Score Matter for Personal Loan?","name":"Why Does CIBIL Score Matter for Personal Loan?","description":"A personal loan comes in handy when you need quick access to funds to finance a variety of expenses. Whether it’s a medical emergency, a wedding, or a home renovation, an instant personal loan can provide you with the flexibility you need to address your financial needs. However, getting approved for a personal loan isn’t...","datePublished":"2023-03-15","dateModified":"2024-09-03","author":{"@type":"Person","@id":"https:\/\/www.indusind.com\/iblogs\/author\/indusind\/#Person","name":"IndusInd Bank","url":"https:\/\/www.indusind.com\/iblogs\/author\/indusind\/","image":{"@type":"ImageObject","@id":"https:\/\/secure.gravatar.com\/avatar\/8169561f34fb61e737060f1a537a86e2?s=96&d=mm&r=g","url":"https:\/\/secure.gravatar.com\/avatar\/8169561f34fb61e737060f1a537a86e2?s=96&d=mm&r=g","height":96,"width":96}},"publisher":{"@type":"Organization","name":"IndusInd","logo":{"@type":"ImageObject","@id":"https:\/\/www.indusind.com\/iblogs\/wp-content\/uploads\/logo-2.png","url":"https:\/\/www.indusind.com\/iblogs\/wp-content\/uploads\/logo-2.png","width":201,"height":86}},"image":{"@type":"ImageObject","@id":"https:\/\/www.indusind.com\/iblogs\/wp-content\/uploads\/cibil-score-matters.jpg","url":"https:\/\/www.indusind.com\/iblogs\/wp-content\/uploads\/cibil-score-matters.jpg","height":400,"width":1060},"url":"https:\/\/www.indusind.com\/iblogs\/personal-loan\/why-does-cibil-score-matter-for-personal-loan\/","about":["Personal Loan"],"wordCount":1058,"keywords":["cibil score","instant personal loan","Personal loan"],"articleBody":"A personal loan comes in handy when you need quick access to funds to finance a variety of expenses. Whether it’s a medical emergency, a wedding, or a home renovation, an instant personal loan can provide you with the flexibility you need to address your financial needs. However, getting approved for a personal loan isn’t always easy, especially if you have a poor CIBIL score or no credit history.CIBIL score is a three-digit number that is a reflection of your creditworthiness. The score ranges from 300 to 900, with 900 being the highest possible score. The higher your score, the better your chances of getting approved for a personal loan.Let\u2019s take a real-life example to understand why CIBIL score matters when it comes to a personal loan.Sameer had been planning to buy a new car for a long time. However, due to a sudden financial emergency, he had to spend a considerable amount of money on his father’s medical treatment. As a result, he was left with little savings to buy the car and therefore he decided to apply for a personal loan.Sameer knew that getting a personal loan is not easy, especially if one has a poor credit history. He knew that lenders check the CIBIL score of borrowers before approving their loan applications. Therefore, he decided to check his CIBIL score first before applying for the loan.Sameer logged in to the CIBIL website and checked his score. To his disappointment, he found out that his score was below 600, which is considered a poor score. He was worried that his loan application would be rejected due to his low score. This is when Sameer realized the importance of CIBIL score while applying for a personal loan. He started researching and found out that there are several reasons why CIBIL score matters for a personal loan.Assessing CreditworthinessOne of the primary reasons why lenders check your CIBIL score is to assess your creditworthiness. The score provides lenders with an indication of your ability to repay the loan on time.A higher score indicates that you have a good track record of repaying loans and managing credit responsibly, which makes you a low-risk borrower. On the other hand, a lower score indicates that you may have missed payments or defaulted on loans in the past, making you a high-risk borrower.Determining the interest rateYour CIBIL score also plays a significant role in determining the interest rate you will be charged on the loan. Lenders generally offer lower interest rates to borrowers with high credit scores and higher rates to those with lower scores. This is because a high score indicates that you are a low-risk borrower, which means the lender is more likely to get its money back.Conversely, a lower score indicates that you are a high-risk borrower, which means the lender may need to charge a higher interest rate to compensate for the additional risk.Loan Approval Your CIBIL score can also affect your chances of getting approved for a personal loan. Most lenders have a minimum CIBIL score requirement that you must meet to be eligible for a loan. If your score is lower than the minimum requirement, your application may be rejected. Additionally, even if your application is approved, having a lower score may result in a lower loan amount or a higher interest rate.In conclusion, your CIBIL score is an important factor when it comes to getting approved for a personal loan. It provides lenders with an indication of your creditworthiness, helps determine the interest rate you will be charged, and can affect your chances of getting approved for the loan. Therefore, it’s important to maintain a good credit score by paying your bills on time, avoiding taking on too much debt, and monitoring your credit report regularly to ensure that it’s accurate.And if you\u2019re looking for an instant personal loan at low interest rate, then do check out IndusInd Bank Digital Personal Loan which is available at interest rates starting at 10.49% as well as low processing fee*. Also, you get to enjoy instant approval and quick disbursal with 100% paperless application process.Apply Now*Terms & conditions apply.Disclaimer: The information provided in this article is generic in nature and for informational purposes only. It is not a substitute for specific advice in your own circumstances. Hence, you are advised to consult your financial advisor before making any financial decision. IndusInd Bank Limited (IBL) does not influence the views of the author in any way. IBL and the author shall not be responsible for any direct\/indirect loss or liability incurred by the reader for taking any financial decisions based on the contents and information.Share This:"}